Correlation Between Fiplasto and Carboclor
Can any of the company-specific risk be diversified away by investing in both Fiplasto and Carboclor at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Fiplasto and Carboclor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fiplasto SA and Carboclor, you can compare the effects of market volatilities on Fiplasto and Carboclor and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Fiplasto with a short position of Carboclor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fiplasto and Carboclor.
Diversification Opportunities for Fiplasto and Carboclor
Poor diversification
The 3 months correlation between Fiplasto and Carboclor is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Fiplasto SA and Carboclor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Carboclor and Fiplasto is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Fiplasto SA are associated (or correlated) with Carboclor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Carboclor has no effect on the direction of Fiplasto i.e., Fiplasto and Carboclor go up and down completely randomly.
Pair Corralation between Fiplasto and Carboclor
Assuming the 90 days trading horizon Fiplasto SA is expected to generate 0.9 times more return on investment than Carboclor. However, Fiplasto SA is 1.11 times less risky than Carboclor. It trades about 0.15 of its potential returns per unit of risk. Carboclor is currently generating about 0.13 per unit of risk. If you would invest 3,050 in Fiplasto SA on September 23, 2024 and sell it today you would earn a total of 34,400 from holding Fiplasto SA or generate 1127.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fiplasto SA vs. Carboclor
Performance |
| Timeline |
| Fiplasto SA |
| Carboclor |
Fiplasto and Carboclor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fiplasto and Carboclor
The main advantage of trading using opposite Fiplasto and Carboclor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fiplasto position performs unexpectedly, Carboclor can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Carboclor will offset losses from the drop in Carboclor's long position.| Fiplasto vs. Longvie SA | Fiplasto vs. Grupo Financiero Galicia | Fiplasto vs. Capex SA | Fiplasto vs. Carboclor |
| Carboclor vs. Capex SA | Carboclor vs. Fiplasto SA | Carboclor vs. Pampa Energia SA | Carboclor vs. Agrometal SAI |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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